Households facing sharp rise in council tax bills over next two years – do you qualify for a discount?

Local authorities across England will be given the go-ahead to plug the gap in social care funding by raising council tax by 6% over the next two years. However, there are steps you can try to bring down the cost of your council tax bill.

The Government has unveiled plans to allow English town halls to crank up the cost of council tax above inflation for the next two years, in a move that could see local authorities add a 3% levy to bills in 2017/18 and 3% in 2018/19.

The 6% increase comes on top of councils' ability to raise council tax by up to 2% each year, meaning some residents could see their total tax bill rise 10% by 2019.

To put this in perspective, if you live in a typical 'band D' household and pay £1,530/year in council tax, and your local authority introduced the 6% social care levy, your annual bill would increase by £91.80 over the coming two years.

If you live in a 'band D' household in an area that introduces the 6% council tax hike alongside the maximum existing annual rise of 2%, you can expect your annual tax bill to rise by £153 over the next couple of years.

It will be down to individual English councils to decide whether they bring in the 6% social care levy.

Why has the Government signed off this tax hike?

English councils have been given the green light to increase council tax by up to 6% to help meet the soaring cost of social care for the elderly and disabled.

Social care funding has dropped by 9% in real terms over the past five years and patients are increasingly being admitted to hospital – putting additional strain on the NHS – because local communities don't have the capacity to provide necessary services.

While the soon-to-be introduced council tax rise will serve to bolster the coffers for social care funding in the short term, councils have warned that a longer-term solution will have to be found to bridge a funding gap that's expected to grow to at least £2.6 billion by 2020.

How can I offset this council tax hike?

Despite the good intentions behind this decision, it'll come as unwelcome news for many households up and down the country already struggling to make ends meet.

However, you may be able to reduce your council tax bill if you're among the hundreds of thousands of residents who are overpaying and entitled to a discount.

There are two ways you may be able to cut your council tax bill:

Question your council tax band. Up to 400,000 homes in England and Scotland could be in the wrong council tax bands. Yet in 10 minutes, at no cost, you can check and challenge your banding, not only potentially slashing what you pay now, but getting you a backdated rebate stretching as far back as 1993.

Thousands of people have already been successful in slashing their council tax bill after a quick check involving a property valuation showed they were in the wrong band. See if you're able to claw back £1,000s by reading our Council Tax Bands guide.

Discounts are available if you live with someone who's 'disregarded for council tax purposes'. MoneySavingExpert.com recently revealed that tens of thousands of people who are living or lived with someone with a 'severe mental impairment' (such as dementia or Parkinson's) may be able to reclaim council tax and get a 25% reduction in future.

But it's important to note that a 25% council tax discount isn't restricted to those living with someone with a severe mental impairment. If you're the only other adult living with someone who falls into any of the following categories of people who are disregarded for council tax purposes, you should be able to claim:

Persons in detention

Persons in respect of whom child benefit is payable

Apprentices

Foreign language assistants

Students on full-time courses

Students under the age of 20 undertaking qualifying courses

Student nurses

Youth training trainees

Patients where hospital is their main residence

Patients in homes

Care workers

Residents of hostels, night shelters etc

Members of international headquarters and defence organisations

Members of religious communities

School and college leavers

Persons with a relevant association with visiting armed forces

Foreign spouses of students

If you think you qualify for a discount because you live with someone in any of these categories, you should contact your council. You may also be able to reclaim for previous years, though the evidence you'll need and the process may vary between councils.

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